We used the cash for keys approach and got him out but it could have been drawn out and unexpected damages which thankfully we avoided.  

@Nick Littleton personally, I have not encountered this issue (I've done numerous owner occupant mortgages, refis, and HELOCs, and no lender has ever asked me about my property management experience, or whether I'm using a PM, or anything about how the property is managed...other than asking to see signed leases that correspond with the rent income I reported on my taxes), so I was surprised by what you described......I'm interested to hear from the lending pros on here: is property management or property management experience a commonly used criterion for loan qualification? 

EDUCATE YOURSELF - yes, it will take time, but will lead to a selection that better meets your expectations & avoids potentially costly surprises!

I am surprised you found a hard money lender that can do seconds on your primary.

There are no capital expense surprises; only surprise timing.  

When dealing with a HML do you always over-budget your rehab cost for unexpected issues or would you recommend keeping a pretty accurate rehab budget to the HML?

Surprisingly a lot of companies don’t like ensuring log cabins.

But one surprise can set you back several thousand dollars and there's no income to balance that.

I would be surprised if no one house hacks in your area!  

The hate towards California is at an all time high and despite being warranted in many ways, theres much more room for positive surprises compared to the hot markets today that are oversaturated with investors.